Energy efficiency and electrification could contribute around 20 per cent of the emissions cuts needed for Australia to hit a 75 per cent reduction target by 2035, according to a new analysis released by the Energy Efficiency Council (EEC).
The analysis, based on scenario modelling by Climateworks Centre, provides the latest evidence of how energy efficiency and electrification can cut emissions in homes, commercial buildings, agriculture, industry and the resources sector.
Together, efficiency and electrification could cut emissions by an average of 44 MtCO2-e per year between 2026 and 2035, far exceeding other demand-side options for cutting energy-related emissions, such as switching to biofuels or hydrogen over the same period.
EEC CEO, Luke Menzel, said electrification and energy efficiency are shovel-ready solutions for climate action.
“They’re some of the most cost-effective and fastest actions we can take to cut emissions and reduce the impact of climate change,” he said.
“No matter what number the Government picks for our 2035 target, if Australia is serious about reaching net zero by 2050, we must up the pace of appliance upgrades, building retrofits and industrial electrification now and not wait until the 2040s.”
Menzel said the Federal Government’s recently released National Climate Risk Assessment demonstrates the urgency of taking action now.
He said the Energy Efficiency Council is calling on the government to put energy efficiency and electrification at the centre of each of its sectoral emissions reduction plans.
“This analysis shows that doing so could support the achievement of an emissions reduction target for 2035 of at least 75%, while also making our homes and businesses more resilient to climate change impacts,” Menzel said.
“We must remember that Australia has also signed up to support a global target to double the global rate of energy efficiency improvement. This analysis shows we could double Australia’s average annual energy intensity improvement rate to six per cent between 2025 and 2030, making sure we hold up our end of the bargain.”
Electrification will play a significant role in achieving emissions reduction targets across the economy. In the analysis electricity is projected to make up around 61 per cent of the total energy fuel mix, increasing from 24 per cent in 2025.
Highlights from the analysis show:
- Efficiency and electrification in the resources sector presents the largest abatement opportunity across the economy, with average yearly savings of 19.7MtCO2-e between 2025 and 2035. This is bigger than the impact of shutting down Loy Yang A power station, the largest point source of emissions in the electricity sector.
- Residential buildings present the largest abatement opportunity within the built environment, with average yearly savings of 6.5 MtCO2-e between 2025 and 2035 and increasing further out to 2050. This is the equivalent to powering around one million Australian homes with zero-emission electricity for a year.
- The industry and waste sector can deliver total emissions savings of 3.1 MtCO2-e per year on average between 2025 and 2035, reaching 8.7 MtCO2-e per year on average between 2046 and 2050. Between 2046 and 2050, this is equivalent to taking about 3.5 million cars off the road each year.
To achieve these impacts, Menzel said the right policies need to be in place to drive tangible changes in millions of homes and businesses.
“We’ll need to double the number of residential heat pump installs each year between now and 2035,” he said.
“In factories, we’ll need to upgrade thousands of inefficient industrial motors and pumps with efficient technologies like variable speed drives, while on farms and in mines, it means replacing diesel-power equipment with battery-electric equivalents.
“None of this will happen without a concerted effort from industry and governments backing it in.”